Silver 1 OZ 999 NY (XAG=X) Falls Off 18.00 Pedestal
Silver prices fell sharply on Tuesday, as the decline of 1.7% was the sharpest one-day drop since December 6. With a lack of U.S. fundamental releases until Thursday, any moves on Wednesday will be subject to technical factors, barring any major geopolitical developments.
We’ll get a look at the first major U.S. release on Thursday, starting with unemployment claims. The indicator fell to 204 thousand last week, its lowest level in six weeks. The forecast for the upcoming release stands at 214 thousand. On Friday, it’s the turn of manufacturing and services PMI. Both indexes are expected to come in slightly over the 50-level, which separates contraction from expansion.
The U.S. economy continues to perform well, with the exception of the manufacturing sector, which has been dampened by the trade war with China as well as a weak global economy. With inflation levels below the Federal Reserve’s target of 2.0%, there is little pressure on the Fed to raise interest rates. That could help explain why silver and gold prices remain relatively high, despite a strong economy and a thriving stock market. As long as interest rates are likely to remain steady or even get trimmed, precious metals should remain attractive to investors.
Silver Technical Analysis
Silver prices sagged on Tuesday, falling to 17.63. There are formidable support levels close by, which so far have prevented the metal from falling further. The 50-EMA line is situated at 17.58, followed immediately by support at 17.50. Given that silver has plenty of support nearby, we could see a recovery back to the 18.00 line or slightly above it. There is resistance at 18.60, followed by resistance at the round number of 19.00.
Overall, the bias in prices is: Upwards.
The projected upper bound is: 18.32.
The projected lower bound is: 17.36.
The projected closing price is: 17.84.
A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 5 white candles and 5 black candles. During the past 50 bars, there have been 30 white candles and 19 black candles for a net of 11 white candles.
Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.
One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 49.5675. This is not an overbought or oversold reading. The last signal was a buy 5 period(s) ago.
Relative Strength Index (RSI)
The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 51.53. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a sell 10 period(s) ago.
Commodity Channel Index (CCI)
The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is -120.This is an oversold reading. However, a signal isn’t generated until the indicator crosses above -100. The last signal was a sell 9 period(s) ago.
The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a sell 7 period(s) ago.
Rex Takasugi – TD Profile
PREC.M.XAG= closed up 0.045 at 17.817. Volume was 8,900% above average (trending) and Bollinger Bands were 56% narrower than normal.
Open High Low Close Volume___
17.771 17.924 17.640 17.817 44,230
Short Term: Neutral
Intermediate Term: Bullish
Long Term: Bullish
Moving Averages: 10-period 50-period 200-period
Close: 17.93 17.38 16.60
Volatility: 17 18 24
Volume: 4,423 885 221
Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.
PREC.M.XAG= is currently 7.3% above its 200-period moving average and is in an upward trend. Volatility is relatively normal as compared to the average volatility over the last 10 periods. Our volume indicators reflect very strong flows of volume out of XAG= (bearish). Our trend forecasting oscillators are currently bullish on XAG= and have had this outlook for the last 23 periods.